The Government has published its response to the Culture, Media and Sport Committee’s report on grassroots music venues.

We previously commented on the Committee’s report here. It was published in response to concerns of a “crisis of soaring costs and closures” for grassroots live music venues, and made three headline recommendations: (1) the introduction of a levy on arena and stadium tickets; (2) a “targeted and temporary” cut to VAT on tickets for grassroots music venues based on the capacity of the venue; and (3) the launch of a comprehensive fan-led review of live and electronic music.

Taking each in turn, the Government has stated that it agrees with the Committee’s recommendation that the music industry should introduce a voluntary levy on arena and stadium tickets to support grassroots music venues, artists and promoters.  As the Response explains, the Government “believe[s] this would be the quickest and most effective mechanism for a small portion of revenues from the biggest shows to be invested in a sustainable grassroots sector”. Reference is made to steps already taken across the industry to establish a voluntary levy alongside a charitable organisation to manage and distribute the levy’s proceeds. However, the Response states that there is more to do “to agree concrete proposals and implement a cross-sector approach”. For its part, the Government is prepared to “use its convening powers to bring people to the table in short measure” if necessary, and does not rule out the possibility of intervening to introduce a statutory levy (as has happened in France) “if no satisfactory progress is made”.

On the matter of a temporary cut to VAT, the Government is less enthusiastic. The Response is clear that there are “no plans to introduce a temporary cut to VAT based on venue capacity or to undertake a bespoke economic analysis of the impact of a VAT cut to 10% on tickets”. The Government explains that “using VAT reliefs to redirect economic activity into one area does not necessarily increase economic activity overall, but may only displace it from other areas, particularly when taking into account the need for raising tax revenue elsewhere to fund the relief”. Instead, the Government points to announcements at the Budget that business rates for retail, hospitality and leisure properties (including grassroots music venues) will be extended for one year at 40% up to a cash cap of £110,000 per business, as well as the extension of the Supporting Grassroots Music Fund for 2025-26.

Finally, the Government also rejects the recommendation to launch a fan-led review of live and electronic music. It states that its vision for the creative industries is set out in its Industrial Strategy, and points to the upcoming consultation on improved protections in the secondary ticketing market and a call for evidence on price transparency for live events ticketing.

Commenting on the Government’s Response, the Creatives Industries Minister, Sir Chris Bryant, said “grassroots music venues are one of the UK’s most valuable and yet undervalued cultural assets. They are where bands try out new material, where whole new genres are born, where musicians experiment and where audiences get to experience the raw power of live music. These venues support thousands of jobs and are a vital part of our local communities. Without a flourishing grassroots music industry the rest of our music industry will wither. It is crucial that we work together to support the grassroots including venues, festivals, artists and promoters. That is why I am urging the industry voluntarily to introduce a ticket levy on the biggest commercial players, to help ensure the health and future success of our entire live music industry for decades to come”.

The Committee’s response was rather less sanguine. Whilst it welcomed the Government’s recognition of the need for the introduction of a levy, it expressed concern that there was both no deadline for industry to reach an agreement, and no deadline for the Government to step in with alternative arrangements should industry talks fail. Therefore, it has told the Secretary of State that if no significant progress is made within six months, it intends to hold a further hearing with the sector in May 2025.

To read the Government’s Response in full, click here. To read the Committee’s response, click here.